Article excerpt

Raj Rajaratnam, a wildly successful hedge fund manager, was
convicted Wednesday of 14 fraud and conspiracy counts for using
insider information to make more than $60 million. Prosecutors call
it the largest insider-trading case for a hedge fund. That certainly
lands him in the Top 5 of convicted inside traders in the United
States. Here is a look at the five most notorious convictions:

Raj Rajaratnam, a wildly successful hedge fund manager, was
convicted Wednesday of 14 fraud and conspiracy counts for using
insider information to make more than $60 million. Prosecutors call
it the largest insider-trading case for a hedge fund. That certainly
lands him in the Top 5 of convicted inside traders in the United
States. Here is a look at the five most notorious convictions:

#6 Raj Rajaratnam (penalty to be determined)

Over a seven-year period, Raj Rajaratnam used a network of
insiders to get advance information on what was going on in public
companies to make money at the expense of other investors.

Using an extensive trove of wiretaps - reportedly, the most ever
in a case of white-collar crime - prosecutors let jurors hear how
Mr. Rajaratnam uncovered key information and was able to trade on
it, once making $1 million with a single trade. He even bragged
about it in calls to employees, prosecutors said.

After a seven-week trial and more than two weeks of
deliberations, the jury found him guilty on all 14 counts - five
counts of conspiracy and nine counts of security fraud. Securities
fraud carries a maximum sentence of 20 years, which if applied to
Rajaratnam would be the stiffest prison sentence of any of the Top 5
convicted inside traders.

Sentencing is scheduled for July 29. Rajaratnam remains free on
bail until then.

#5 Joseph Contorinis (Sentenced to six years in prison)

In 2010, Joseph Contorinis was convicted of insider trading that
prosecutors say netted $7 million in profit. He was tipped off by
UBS AG investment banker Nicos Stephanou about upcoming acquisitions
and mergers.

Mr. Contorinis was sentenced to six years in prison under federal
guidelines that give longer sentences for bigger profits. The
prosecution argued that Contorinis should have received more prison
time, because the insider tips had kept his fund from losing more
than $6 million, which they said should have been added to his total
profit.

#4 Sam Waksal (Seven-year sentence, $4 million in fines and back
taxes)

You might not recognize Samuel Waksal's name, but you've
certainly heard of his friend Martha Stewart. In 2001, Mr. Waksal,
the founder of ImClone Systems, got word that the Food and Drug
Administration would reject his company's application for approval
of a new drug. Waksal allegedly warned Ms. Stewart, who sold 4,000
shares of the stock before the FDA announcement sent it plummeting. …